# Question No 40 Chapter No 15 – USHA Publication 11 Class

Q-40 - CH-15 - USHA +1 Book 2020 - Solution

Question No 40 Chapter No 15

Renewal of Bill

40. Q drew a bill of exchange on P for Rs 4,000 on 1st May 2018 for 3 months. P returned the bill to Q after acceptance it. Q discounted the bill at his bank for Rs 3,900. Just before the due date, P approached Q for the renewal of the bill. Q agreed on condition that Rs 1,000 plus interest on the balance at 6% per annum for 3 months be paid in cash immediately and a new bill for 3 months be drawn for the remaining balance. These condition were carried rupee in full settlement
Give journal entries in the book of P and Q

### The solution of Question No 40 Chapter No 15: –

 In the book of P (Drawee) Date Particulars L.F. Debit Credit 2018 May.1 Q A/c Dr. 4,000 To Bill payable A/c 4,000 (Being acceptance given for three months.) Aug.1 Bill payable A/c Dr. 4,000 To Q A/c 4,000 (Being cancellation of the old bill.) Aug.4 Q A/c Dr. 1,000 Interest A/c Dr. 45 To Cash A/c 1,045 (Being part of payment made along with the interest.) Aug.4 Q A/c Dr. 3,000 To Bill Payable A/c 3,000 (Being new bill acceptance for the balance for 3 months.) Nov.7 Bill Payable A/c Dr. 3,000 To Q A/c 3,000 (Being bill dishonoured on Maturity.) Oct.7 Q A/c Dr. 3,000 To Cash A/c 1,200 To Deficiency A/c 1,800 (Being payment of a dividend of 40 paise full satisfaction.)

 In the book of Q (Drawer) Date Particulars L.F. Debit Credit 2018 May.1 Bill Receivable A/c Dr. 4,000 To P A/c 4,000 (Being receipt acceptance given for three months.) May.1 Bank A/c Dr. 3,900 Discount A/c Dr. 100 To Bill Receivable A/c 4,000 (Being receipt of an acceptance for one month.) Aug.4 Cash A/c Dr. 1,045 To P A/c 1,000 To Interest A/c 45 (Being part payment received with interest.) Aug.4 Bill Receivable A/c Dr. 3,000 To P A/c 3,000 (Being receipt of new bill for the balance amount for 3 months.) Nov.7 P A/c Dr. 3,000 To Bill Receivable A/c 3,000 (Being dishonor of the bill due to P’s insolvency.) Nov.7 Cash A/c Dr. 1,200 Bad Debts A/c Dr. 1,800 To P A/c 3,000 (Being the receipt of a dividend of 40 paise in the rupee in the full satisfaction of our claim against P for Rs 3,000.)

Bills Receivable Book | Subsidiary Books | Examples

Bills Payable Book | Subsidiary Books | Examples

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## Usha Publication – Elements of Book-Keeping PSEB (Class 11) – Solution

Chapter No. 1 – Introduction

Chapter No. 2 – Theory Base of Accounting

Chapter No. 3 – Origin of Transactions

Chapter No. 4 – Vouchers and transactions

Chapter No. 5 – Journal

Chapter No. 6 – Accounting for Goods and Services Tax(GST)

Chapter No. 7 – Ledger

Chapter No. 8 – Cash Book

Chapter No. 9 – Other Subsidiary Books

Chapter No. 10 – Journal Proper

Chapter No. 11 – Trial Balance

Chapter No. 12 – Bank Reconciliation Statement

Chapter No. 13 – Depreciation

Chapter No. 14 – Provisions and Reserves

Chapter No. 15 – Bills of Exchange

Chapter No. 16 – Rectification of Errors

Chapter No. 17 – Financial Statements – (Without Adjustments)

Chapter No. 18 – Financial Statements – (With Adjustments)

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